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UPDATE 2-Senior U.S. EPA official overseeing emissions rules resigns

Valerie Volcovici and David Shepardson

(Adds comment from former deputy administrator)

WASHINGTON, June 26 (Reuters) - Bill Wehrum, the U.S. Environmental Protection Agency official in charge of revising power plant regulations and revamping vehicle emission standards and biofuels, is stepping down June 30, the agency confirmed Wednesday.

Wehrum, the assistant administrator for air and radiation, told staff and others in an email Wednesday he was resigning. He said he was proud of the administration's efforts "due in part to the clear direction provided by the president and the dedication of Administrator (Andrew) Wheeler to accomplishing the Agencys mission."

Wheeler said while he knew Wehrum would eventually step down the departure date "has still come too soon" but applauded Wehrum for finalizing last week the Affordable Clean Energy regulation, a replacement for the Obama administrations signature climate regulation that targeted carbon emissions from power plants.

Wehrum and the National Highway Traffic Safety Administration have been working to finalize a massive rewrite of vehicle emissions standards through 2026. Wehrum said after testifying at a U.S. House of Representatives hearing last week that he expected it would be "weeks" before the proposal was submitted to the White House Office of Management and Budget for final review.

Democrats in Congress had asked the EPA's inspector general to review whether Wehrum and other officials helped to reverse the agencys position in a major enforcement action to favor a client of their former law firm.

Democratic lawmakers had also launched an investigation about the Utility Air Regulatory Group, an organization of power companies with coal fired plants in their fleets who sought to loosen emissions rules that Wehrum had previously represented.

That group dissolved in May due to heightened scrutiny.

Mandy Gunasekara, who had worked as Wehrum's deputy until February, told Reuters that while Wehrum was "frustrated" with the probes into his industry links, he told her he had only planned to stay at EPA for around one year.

She added that he wanted to leave after completing ACE and several permitting reforms and that other rules that are in progress, such as the vehicle emission rewrite "are in a really good position."

"They have gotten through the biggest decision points. What remains is applying the methodology they agreed to and the overarching legal arguments," she said, adding that revamped methane regulations would also be ready this summer.

Chris Grundler, who currently serves as director of the Office of Transportation and Air Quality, will become director of the Office of Atmospheric Programs, which oversees the agencys climate change programs and other functions. He will be switching jobs with Sarah Dunham, who has held that role since 2011.

Grundler has overseen the office working to address excess diesel emissions in vehicles, including the EPAs review of Volkswagen AG and Fiat Chrysler polluting vehicles.

Anne Idsal, the principal deputy administrator, will replace Wehrum on an acting basis, Wheeler said in a statement Wednesday. (Reporting by Valerie Volcovici; Writing by David Shepardson Editing by Chizu Nomiyama and Marguerita Choy)